CHINA ENV RES (01130) announced that on March 3, 2026, the Company, Sichuan Yuanlaishun Rare Earth New Material Co., Ltd. (Sichuan Yuanlaishun), and the People's Government of Anting Town, Jiading District, Shanghai Municipality (the Anting Town Government) (collectively referred to as the "Contracting Parties") entered into a non-legally binding memorandum of understanding concerning a potential collaboration for a rare earth resource development project located in an industrial park in Anting Town, Jiading District, Shanghai Municipality, People's Republic of China. The collaboration is subject to the terms and conditions of a formal, legally binding agreement to be executed separately.
Pursuant to the memorandum of understanding, the Contracting Parties agreed to leverage their respective advantages in technology, resources, policy, and industry layout for the relevant cooperation in the development project. Accordingly, these responsibilities include: (i) The Company will be primarily responsible for (a) designing environmental protection plans for the industrial park and obtaining environmental assessment approvals to ensure the project complies with relevant Chinese environmental regulations; (b) providing environmental technology equipment and operational management support; and (c) assisting in connecting with international resources, exploring overseas markets, and introducing quality investors. (ii) Sichuan Yuanlaishun will be primarily responsible for (a) contributing core patents such as dysprosium permeation technology and hollow billet production processes, leading the implementation of required technologies; (b) undertaking the construction and operational management of production lines within the industrial park to ensure production capacity meets planned targets; and (c) within three years, introducing talent for an academician expert workstation and a provincial-level technology center to enhance research and development capabilities. (iii) The Anting Town Government will be primarily responsible for (a) providing land for the industrial park and coordinating land approval and infrastructure construction; (b) actively supporting the Company's applications for relevant national, municipal, and district-level industrial, technological, and talent policies; and (c) providing support services in areas such as talent recruitment, residence permits, children's education, and medical services to ensure the smooth implementation of the development project.
The development project involves (i) the disassembly and recycling of waste rare earth motors, and the restoration of magnetic steel materials; (ii) the customization of rare earth motors for new energy vehicles and the smart manufacturing of high-speed motors; and (iii) the establishment of a rare earth new materials marketing center and a rare earth motor technology innovation center within the industrial park.
The Board of Directors believes that the cooperation with Sichuan Yuanlaishun and the Anting Town Government on the development project constitutes a strategic initiative. This collaboration enables the Group to consolidate its existing business and market position in the recycling and reuse of recyclable resources from new energy motorcycle rear tire components, particularly rare earth permanent magnets. It also facilitates expansion from its current base in Sichuan Province in Western China to the Yangtze River Delta region. Furthermore, the other scopes of the development project present the Group with commercial opportunities to participate in other segments of China's rare earth industry and the international sales of rare earth products.